The issue of whether employees are casuals or permanents has been a vexing issue for employers for some time now. As I say to my clients “just because you call them a casual does not mean that they are one”.As you all probably know, a casual employee does not receive annual leave or personal (sick) leave and in return gets paid a “loading” which is usually 25% of the permanent wage added on.

With casuals, employers do not need to give notice of termination like they do for permanent employees which can mean sometimes up to 3 months notice or more.

A casual employment relationship has many features and an important one is that there is no expectation, on either side, that the employee will work certain shifts or hours on an ongoing basis. A classic example is some bar staff who are told, perhaps each week, when they will be required, if at all. Those staff that have been working regular shifts or days over an extended period, and expect to work those hours, will not be casual employees.

The problems for employers in getting it wrong were again highlighted in a recent case involving a Miner on a fly-in fly out basis. He was paid $40 an hour which was supposed to cover all payments due to perform the work.Importantly, he was engaged as a casual pursuant to a contract and the loading was referenced as part of his payment.

He was dismissed with one hour’s notice, in line with his contract and consistent with a casual employment relationship.

He disputed the dismissal saying that he was entitled to annual leave and personal leave.The Court looked at the relationship and held that it was not a casual relationship and that he had a reasonable expectation of ongoing work.

But the kicker for the employer was that they failed in an argument that any payment for annual leave should be offset by the casual loading paid.Therefore the employee continued to be paid $40 per hour and could get his annual leave.

This was an expensive mistake for the employer and one that other employers should ensure does not happen to them.

Before employing casuals, make sure that they are in fact going to be seen as casuals pursuant to the law.

Written by Andrew Bland

Dominic Woolrych

Dominic is the CEO of LawPath, dedicating his days to making legal easier, faster and more accessible to businesses. Dominic is a recognised thought-leader in Australian legal disruption, and was recognised as a winner of the 2015 Australian Legal Innovation Index.